Food Service Management Exam 1

STUDY

PLAY

1) Identification of the problem 2) Development of alternatives 3) Evaluation of alternatives 4) Selection of an alternative 5) Implementation of the alternatives 6) Evaluation of the choice

Planning for implementation requires the following

-Clearly envision what the implementation looks like -Outline the specific tasks that must be completed- Identify the resources that are required for each task-Identify how much time it will take to complete each task- Someone is assigned the responsibility for each task

How to make high quality decisions

Tips in using the rational decision making model - Select criteria against your alternatives that will be tested - Generate several ideas - Weigh the pros and cons of each alternative - Keep searching for new information - Be aware of all consequences for each alternative - Plan meticulously for the implementation

2) Cost-Benefit Compares costs and financial benefits of a project or decision

3) Cost-Effectiveness Comparison of alternative courses of action in terms of their cost and effectiveness

4) Networks Graphic representation of a project depicting flow and and sequence of defined activities

5) Linear Programming An aid in allocating resources

Creativity def

generation of unique ideas

Innovation def

using these unique ideas

How to encourage creativity

-hire creative people-train employees to be creative-create climate that encourages-be flexible-value new ideas-provide opportunities for employees to interact-celebrate success

Characteristics of creative organzations

- open communication- no limits on how to preform work- hetergeneous- ideas are objectively based on merit- encourage risk taking- personal freedom- participative decision making

Successful decision makers

- always prepared- know culture of organization- use decision making process- include employees in decision making process- support group decision making- ensure reliable info is used- creative problem solving when needed- create open climate to encourage feedback

Management Def

process of integrating resources for accomplishment of objectives

Management Functions (5)

planning: determining in advance what should happenorganizingleadingcontrollingstaffing

1. Take responsibility/make decisions2. listen to your instincts3. lead by example4. good communcation

Effective def

doing the right things

Efficient def

doing things right

(cant compensate for lack of effectiveness)

General Manager

responsible for all activities of a unit

Functional Manager

responsible for only one area of the organization

3 Managerial levels

1. First Line Manager- day to day operations2. Middle Manager- coordinated activities that implement policies + facilitate activities at technical level3. Top Manager- executives that control the organization, vision of future, overall responsible

3 types of management skills

1. technical2. human3. conceptual

technical skills

ability to understand the technology available to perform job (lower skills)

human skills

working with people and understanding their behavior (required by all levels)

1. assets= accounts that list what is owned by the business2. liabilities = are obligations to creditors that the company has acquired through the normal course of business 3. owner's equity = accounts that deal with the net worth of a business

2 types of assets

1. current assets: are converted to cash in less than one yrs time (cash, inventory, accounts receivable, prepaid expenses)2. fixed assets: have an expected life greater than one year or are permanent in nature (plan + equipment, land, buildings, accumulated depreciation)

2 types of liabilities

1. current liability (short term) acquiring goods and services on credit that must be paid within one year (income tax payable, short-term debt, accrued expenses, accounts payable)2. Fixed liability (long term) acquiring goods and services on credit for more than one year (mortgage payable, long term debt)

components of owner's equity

capital stock additional paid in capital retained earnings

Income Statement

provides a picture of the company's financial performance over a specified period of time- tells if profit or loss

2 types of accounting methods

1. cash accounting methods- does not recognize that items are prepaid or accrued, revenues are reported in the period in which they were paid2. accrual accounting method- record expenses when they occur

Income Statement Weighted Average

total value of the inventory and determines the average price based upon all the items in the current inventory*utilizes the cost of sales formula for inventory

Cash flow statment

reflects the cash position of the firm- lists cash at beginning of fiscal period, and then shows how cash was generated and used by business

Items recorded on Statement in change of stockholder's equity

net profit, net lossselling additional shares of stock repurchases of company of its own stockdividends

3 basic organizational forms

1. sole proprietorship (1 owner) - simplest, owner completely liable2. partnership (2 or more owners)- have unlimited liability3. corporations (business incorporated under laws of the state with ownership held by stockholders. )

Corporations continued

legal entity = profits are taxed.. higher..

= limited liability

taxed twice

higher costs associated with operating an organization

Standard of comparison (2)

internal standard of comparison- review of current performance in relation to budgeted performance, past performance, or pre-established department standards

external standard of comparison- include review of performance in relation to similar operations or comparisons with industry performance

Ratio Analysis

Common ratio: Between X:Y Percentage ratio:Expressed as a % Turnover ratio: Y divided by X On a per unit basis: Dollars per unit

liquidity ratios

organizations ability to meet current obligations or its ability to pay bills when due

solvency ratios

used to examine an establishments ability to meet long-term financial obligations

activity ratios

measures how effectively an organization is utilizing its assets, usually expressed as a percent (%) turnover

profitability ratios

measures the ability of an organization to generate profit in relation to sales of the investment of assets

operating ratios

concerned with analysis of success of the operation in generating revenues and in controlling expenses.

Trend Analysis

is a comparison of results over several periods of time which is used to forecast future revenue or levels of activity

break-even analysis

point at which the organization is just breaking even financially, making no profit but incurring no loss. (total revenues = total expenses)

components of breakeven analysis

fixed costs- costs required or an operation to exist, even if it produces nothing

variable costs- costs that change in direct proportion to the volume of sales

Break even equation

Fixed cost/ (1-[variable cost/sales])

2 investment decision

payback period

net present value (NPV)

Def of Communication

transfer of information that is meaningful to those involved

primary components of communication

sender- person who encodes the message and sends itmessage- communication that is intended, sent through channel (face to face, bill board, etc.) receiver- responsible for decoding (interpretation) messagefeedback- return to the message, enhances effectiveness of the communication process

Noise DEF

any factor that hinders the receipt of the intended message (physical or actual)

One way communication

sender communicates without expecting or getting feedback from reciever

various elements of a job are assigned point values, such as skill level requirement, proficiencies, or working conditions

factor comparison

scale is developed as the standard measurement against which all jobs are compared

collective bargaining

unionized companies, formal bargaining between management and labor representatives sets wage levels for specific groups of workers, based on market rate, and the employer's resources available to pay wages